Tuesday, July 7, 2015

The Importance of a Plan B

Up till now I have been a champion of the Syriza government in Greece.  I have blamed Greece's problems primarily on the European system being unreasonably slanted toward creditors.  I have watched in outrage as the whole idea that a country should be run for the good of its domestic population instead of for foreign creditors is treated as something radical or even insane.  I have gnashed my teeth in fury at the Europeans for crushing the Greek economy and then complaining that they feel betrayed by Prime Minister Alexis Tsipras' insistence on having some breathing room.  I have been outraged by their chutzpah in complaining refusing to allow even a few face-saving token compromises and them denouncing Tsipras' intransigence.  But this time I actually do agree that Syriza has done the inexcusable.  It doesn't have a Plan B.  Apparently Tsipras came to the table without a detailed plan.

Let us concede that Tsipras and the rest of the Syriza team were naive in thinking that Europe was going to relax its grip just because the Greeks had voted in favor.  Let us concede that they were naive in believing that bringing a democratic mandate to the table would be enough to make Europe budge.  Still, all that can be dismissed as inexperience and not knowing what they were up against.  It is a pardonable failing.

But now Tsipras and his team have had five months to learn what Europe is made of, five months to learn what the Eurocrats think of democratic mandates, five months to learn that the Eurocrats don't want negotiations and compromise, they want unconditional surrender.  So Tsipras held a referendum asking the Greeks, in effect, do you want your country to be run by a bunch of Eurocrats for the sake of its creditors.  By a landslide, the Greeks voted "No."  So what does Tsipras do?  He heads back to the negotiating table waving an even stronger democratic mandate, thinking that this will make Europe finally agree to more favorable terms.  As the old saying goes, insanity is keeping on doing the same thing and expecting a different result.

As I have learned through long and frustrating experience, any time you base your plans on the other person doing what you think they should do, you are setting yourself up for disappointment.  No matter how obvious it is to you that you are right, there is no guarantee that the other person will agree -- or share your priorities.  If you can persuade the other person, great.  But if you can't, then to base all your plans on getting the other person to do what you want is to give the other person a unilateral veto over anything you want to do.  You really don't want to do that.  If your ideal plan requires a certain course of action by the other person and there is no way for your ideal plan to work without it, well, go ahead and make your ideal plan.  Just don't count on it.  Have a Plan B ready if things don't go your way.

Tsipras appears to have actually believed what he said about the referendum strengthening his hand in negotiations.  He does not appear to have taken any account of the obvious -- that it would not.  He should have gone to the negotiating table with Plan A ready at hand, ready to drive a hard bargain.  And all the while, he should be working like mad on Plan B, the Grexit.  It now appears he did neither but simply expected Europe to respect the results of the referendum.  And this incident convinces as nothing did before that Greece needs a new Prime Minister.  This one is clearly incompetent.

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